09 February 2007

An Extra Tax On Families Not The Way To Go

While New Zealand First supports Finance Minister Michael Cullen's objectives of belatedly rebalancing the economy towards exporting and developing an improved savings regime it does not understand how the consideration of a mortgage interest levy would be preferred as the most practical policy towards that end.

"Dr Cullen needs to introduce anti-inflationary forces to promote export and employment growth by introducing a dramatically extended savings policy," said New Zealand First Leader Winston Peters.

"A regime providing incentives for increasing savings against consumption is a more reliable and effective way to address inflationary pressures than casting around for initiatives that inadequately deal with a failing monetary policy.

"New Zealand First recognises the problems of high interest and exchange rates that Dr Cullen is faced with, (we've argued against this for years), but a response by way of a new tax on New Zealand families is crude, unfair, discriminates against the 80 percent who have fixed mortgage rates, and should not be preferred over much sounder policies to achieve both lower interest rates and higher savings," concluded Mr Peters.

ENDS

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